Having worked, consulted and coached for many companies over many years, I realized that some of these companies now no longer exist. For some they were acquired by larger, more aggressive companies and for others they simply dwindled into extinction, along with the dinosaurs. Of course some companies are created with a view to selling when the time is right, but most are not. Most desire to stay in existence generating healthy shareholder returns for many, many years. So, why do some companies fail, and more importantly, could they have been saved with a little bit of business and leadership magic?
Companies fail for many reasons and normally it's not just one reason but many. There is normally a complex interplay of factors much of which is not in the direct control of the people running the company. But many are, and it's those factors that can be influenced and changed to provide a stronger foundation enabling a company turnaround to be kick-started. Much has been written about how to turn a company, or even a department within a company, around. In my experience here are the 7 essential steps to ensure a company gives itself a fighting chance to survive, and through continued positive change, evolve into a leaner, meaner, stronger company that will actually thrive over time. Sounds easy(!) but in reality its anything but. However, by following a robust, time-proven turnaround process, many companies can and do re-invent themselves and become winners in the ever-changing game of business.
- Place the right people on the bus. Have you ever wondered why certain people manage to return from bankruptcy, or seem to thrive during business turnarounds? It's because they and their colleagues, the change agents of any company, are the right people on the bus. Without these people no significant and lasting change can be made. It's these people who through vision, tenacity and raw determination to win, are the true starting point for any turnaround. If your company is struggling and you know you need to change to survive, then pick the people who fall into the above category. If you don't have then, then find them quickly, or at least coach the people you have into these roles as your most immediate task.
- Align the team on your current reality. I have seen many instances where a team simply cannot align on where the company really is today. People hope it's different, or simply can't see the obvious realities of the ever-changing market. And without full understanding and alignment, essential energies will be leached away as staff don't rally around a common understanding. Don't underestimate how crucial this part of the process is. Seek alignment and don't move onto the next step without full alignment and buy-in. Skipping this step, or trying to gloss over it in some way will only lead to failure. Business magic has a chance to take root only once everyone agrees on what's wrong, and at a high level what needs to be changed.
- Become a chess master and create a winning strategy. Action is often said to be easy, but strategy is not. Strategy is essential to create, since without it, it's like going orienteering in dense woods without a compass. Pick a process to do this - if you don't have one simply Google "Strategy plan" or "Business plan" and you will find something that is the right approach and right complexity for a company of your size. You can also consider hiring a consultant, which can take the burden of creating and implementing the process away from a key employee, as this key employee might be better served focusing 100% of their input into the strategy process. Don't try and rush this step since once strategy is created, it really is the marching orders for your company-saving initiative
- Communication becomes king. A strategy not shared is a useless strategy in my opinion. The more employees an organization has the more essential robust communication becomes. Proper directed communication will re-energize and empower the whole team and ensure alignment. This provides a natural 'amplification effect' where efforts really can generate more than the sum of the individual parts.
- Now it's time for clinical execution. No strategy ever succeeded without a clinical and determined approach to its implementation. The clearer the strategy the more chance it has of being implemented well. Focus on outcomes and not action, and always course-correct as you navigate through the changes. But don't course-correct too much otherwise your strategy will just become a forgotten memory. Like any sports team who has won a game when all was thought to be lost, in business it's also about tenacity and the determination not to give up. There will be road bumps along the way, maybe even some big ones, but think of these as essential testing points to ensure you really are making necessary change. They can all be overcome one-by-one!
- The rapid change phase. Once everyone is aligned and executing against the well-constructed strategy, its normal to enter a phase of rapid change. This is often exciting, motivating and fun. But it can also be scary, challenging and uncomfortable. Lead by example here and refer back to the strategy as often as required. More importantly energize staff through the storytelling of the great outcomes that will be achieved through their efforts. This motivation will put rocket fuel in the company's engines, and create the energy to burst through any challenge.
- Changing and embedding to a new culture. Once tangible progress is evident (and it will become evident), the changes and how those changes were accomplished should now be understood fully. These lessons need to be embedded and institutionalized into the culture and DNA of the company. The encouragement from senior management to now continually change and strive for betterment will ensure a relapse to old ways does not happen. It will take motivation, empowerment, vision sharing, buy-in of future outcomes, and a whole lot more to really change the culture. But it can be done and has been done many times before. Besides, once the initial momentum has been created, and you are starting to see the success of your new strategy, it creates an internal energy that allows everyone to have a spring in their step again. Harness this newfound energy for further business acceleration.
And, of course there is always a final step, one that is oft forgotten by highly driven business leaders - remember to CELEBRATE! Human beings love challenge, and even more love to celebrate when these challenges are overcome. A few dollars and a few hours invested wisely will provide a great tonic to release stress, bond a team even closer, and provide a refill of rocket fuel for the next stage of your company's growth plans. I believe these simple to understand steps, implemented with passion and with urgency, can provide any company the fighting chance it needs for survival. Now - imagine the excitement of being part of your own compelling company turnaround!